From Our Work With 1,000 Funders, Here Are 3 Tips for Measuring Impact

There is no doubt that measuring impact is the hottest trend in philanthropy today. How can our organization track the outcomes our grants are having? How can we track more useful information to make better decisions?

From working with almost 1,000 grantmakers, we’ve identified some steps you can take to make this process more consistent and accurate, and to build commitment within your organization and among your grantees.

Alignment means everyone understands the plan

Probably the biggest challenge to ensure success in measuring results is getting everyone on the same page and doing things the same way. To be successful:

The board needs to agree on what the organization is trying to accomplish.

The staff needs to be consistent in how they accept and manage grantee reports.

The grantees need to understand why and how this data needs to be reported accurately.

Easier said than done! Fortunately, there are tools out there to help. Exponent Philanthropy has many resources available, including a great tool called the 10-Minute Impact Assessment to use with your board. Foundation Center also has several resources available to help you and your grantees define an impact strategy.

I cannot overemphasize the importance of taking the time to agree, align, and then act when it comes to measuring impact. I have heard many stories of both funders and grantees getting frustrated when this process is not taken. Changing priorities, inaccurate and inconsistent data, and a lack of awareness of the objectives will certainly kill your momentum. It can also create a lack of trust in what is being measured.

Be selective and set the rules

For any cause or community, there are numerous variables available to be evaluated. One of the most common mistakes we see is trying to measure them all, and at the same time. From watching our clients, I would recommend choosing the top 3 to 5 variables that are the most important or easiest to get started measuring. This will make it easier to see progression. It also doesn’t create as much impact on your grantees as they attempt to track and report their results back to you. Variables can always be changed over time based on what is learned.

It is imperative that the process be intentional and specific in regard to what and how these variables are measured. If it cannot be completely clear what is to be counted and what is not, the data will be inaccurate and hard to evaluate. Some variables are easier to track than others. Things like graduation rates, teen pregnancy rates, or acres conserved as a percentage of a specific region are much easier to track, but can also still be manipulated to show different results.

One of my favorite books in college was How to Lie with Statistics by Darrell Huff. It really points out how much perspective can impact statistics. Take the acres conserved example. Should areas in a region that are not conducive to building upon be counted the same way as land that has prime real estate potential? Grantee numbers can be significantly different based on points like these. This is why it is so important for the collector of this data to set the rules on what can and cannot be counted.

It is also important to note that not all data is easily measured. But this does not mean this type of data isn’t important. You will not be able to run a pie chart on the data or easily track the changes over time, but in some cases these “stories” represent some of the greatest moments in philanthropy. The more important part is that you have been intentional about what information is important to your organization to track to know you are making an impact.

Communicate, communicate, and communicate

Collecting data without sharing it is a waste of time and resources. The data becomes more valuable as more people are able to see it, both in analysis format as well as the raw data. Unfortunately, transparency when it comes to grantmaker data is not the de facto norm.

At the very least, the results of your findings need to be shared at all levels within your organization and with the grantees who provided the data. The information should generate conversation about what is working and what is not. Too often, when things do not work out as planned, it is not spoken about. This is a mistake. Poor results can actually be more useful than positive results. They create learning moments, and, if shared widely, they can help others avoid similar mistakes. Foundant hosted a webinar last year during which two of our clients spoke about their experience talking to their grantees about their outcomes.

The most exciting part of taking the time and expending the effort to measure your impact is that it is not a final destination. It is a compass to help guide the continued evolution of your efforts. It is time well spent, but it is not easy. Fortunately, you are not alone. Many organizations and vendors are here to help. There are also many other funders who are tackling the same problems and have shown a willingness to share their thoughts and experiences. Seeking out those resources to learn from and share with can help keep you from having to reinvent the wheel, so to speak.

Assessing impact is the hot topic in philanthropy today for a reason. It represents the launching pad for where the sector is going tomorrow. And I, for one, am excited to see how it grows, evolves, and ultimately improves philanthropy for us all.

Mark Larimer leads the Client Services and Marketing teams at Foundant Technologies. Foundant is an Outside Magazine Best Company to Work For and an Inc. 5000 Fastest Growing Privately Held Company providing grants management solutions to over 850 grantmakers of all types and sizes. Mark’s high-tech career includes time with Extended Systems (acquired by Sybase) and RightNow Technologies (acquired by Oracle) prior to becoming a founding partner of Foundant in 2006.